14:30 The Minister of State, Department of Energy and Climate Change (Andrea Leadsom)

Solar PV is an important part of the low-carbon energy portfolio. It has seen strong growth in recent years, due in no small part to support from the renewables obligation and the feed-in tariff schemes. In many ways that progress is excellent news, making a valuable contribution to our renewable electricity generation. The amount of deployment, however, has also raised concerns about its impact on the levy control framework, the budget that caps the amount of support paid for through consumers’ energy bills. I am sure hon. Members agree that the Government need to act responsibly when there is a risk of exceeding such a budget. We have therefore introduced a number of measures to deal with the projected over-allocation of renewable energy subsidies. In those measures we have aimed to strike the right balance between the interests of consumers and the interests of developers.

The Government are committed to combating climate change, but in the most cost-effective way for bill payers. By summer 2015, the costs imposed on bill payers associated with support for renewable and low-carbon electricity generation were forecast to reach £9.1 billion in 2021, significantly above the target of £7.6 billion. If the costs reached that level, they would need to be met through increases in consumer bills. It is therefore absolutely right that we have looked at ways to protect value for money and affordability under the levy control framework. I hope hon. Members will agree that on balance, the approach we have taken is the right one. We are closing a demand-led scheme and taking action on overcompensation, while still allowing solar to be deployed under the revised feed-in tariff scheme. That will ensure that solar PV is supported in a way that offers better value for money for consumers. I commend the draft order to the House.

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14:57 Melanie Onn (Labour)

It is a pleasure to serve under your chairmanship, Mrs Gillan. Great Grimsby produces a higher proportion of our electricity from renewable sources than any other town or city in the country, making my constituency the renewable capital of England—although mistakenly called a city, for some reason. That is partly as a result of the efforts of the solar industry. We have 10 companies working on solar installation in the town, and perhaps because hundreds of people in the town work on the offshore wind farms, the industry has raised people’s awareness of renewable energy more widely. Solar was, until recently, a growing sector in the town.

My constituency really needs more of the jobs that these organisations are able to offer. For years we have consistently had one of the highest unemployment rates in the country, but the growth in the renewable energy industry from solar and other sources is giving people in the town renewed hope for their employment prospects and those of their children. As I mentioned to the Minister this morning, I recently hosted the renewable energy skills fair. Over 130 people attended, and they are keen to move into the sector, but the Government’s change in policy for the solar industry, particularly since May 2015, has led to the loss of thousands of jobs nationally, with many more at risk of going in the near future. This has been done at a time when the sector really is on the cusp of becoming economically competitive; so many more thousands of jobs could be created if the Government took a different approach.

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15:00 Helen Hayes (Labour)

I met recently with a small-scale solar installation company in my constituency. The proprietor told me that since the announcement the bottom has dropped out of the solar market part of his business. He does a number of other things—he installs windows and so forth—so that did not directly translate into job losses for his business, but he said that interest from domestic consumers in installing solar panels had simply dried up. That has the effect of stopping individual households who want to do the right thing and do their bit towards combating climate change from doing so.

We have no more pressing challenge than climate change and central to addressing that is a fundamental shift in how we produce energy in this country. This measure damages the progress made towards a shift to renewables. It is short-sighted, bad for business and bad for the environment. I oppose it wholeheartedly.

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